Contract Structure of Production Sharing Agreement by International Oil Company in Exploration of Petroleum Resources in Developing Countries

Shafiqul Hassan, Yusuff Amuda, Mohsin Dhali and Saghir Munir Mehar
Additional contact information
Shafiqul Hassan: Prince Sultan University, Saudi Arabia,
Mohsin Dhali: Prince Sultan University, Saudi Arabia,
Saghir Munir Mehar: 2MNA Management Group, Canada.

International Journal of Energy Economics and Policy, 2023, vol. 13, issue 3, 7-14

Abstract: Presently, there is little focus on the contractual agreement, particularly on the production sharing agreement by the International Oil Companies in the exploration of petroleum resources of developing countries. The primary objective of this paper is to critically explore the contract structure of production-sharing agreements by International Oil Companies in the exploration and development of petroleum resources in developing countries. Content analysis was used as the methodology of the study after examining several literatures. The findings indicate that the contract structure of the production sharing agreement (PSA) between National Oil Companies (NOC) and International Oil Companies (IOC) plays a significant role in the cost and risk of exploration and development of oil. In addition, it is noted that the joint committee of the NOC and IOC plays a paramount role in monitoring the operations of PSA between the NOC and IOC. Hence, from the gross oil production, the NOC gets its share as profit while IOC gets its share income tax. As an instrument of contract structure in the oil and gas sector, PSA needs further entrenchment between IOC and NOC to avoid likely issues that can emanate between the two parties in the face of current developments.

Keywords: Petroleum Resources; Contract Structure; Production Sharing Agreement; Energy; International Oil Company; National Oil Company; Oil (search for similar items in EconPapers)
JEL-codes: K12 Q40 Q48 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.econjournals.com/index.php/ijeep/article/download/14142/7275 (application/pdf)
https://www.econjournals.com/index.php/ijeep/article/view/14142 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eco:journ2:2023-03-2

Access Statistics for this article

International Journal of Energy Economics and Policy is currently edited by Ilhan Ozturk

More articles in International Journal of Energy Economics and Policy from Econjournals
Bibliographic data for series maintained by Ilhan Ozturk ().